“India opposes any development projects in areas that belong to India but are under forcible and illegal occupation of Pakistan. We have made it clear to all the countries,” foreign ministry spokesperson Vikas Swarup said in Delhi.

Prospective investors such as the Asian Development Bank had earlier insisted Islamabad should get a no-objection note from India.

But some of India’s other anxieties dropped when a senior American official told Indian reporters, shortly after Sharif’s meeting with President Barack Obama at the White House on Thursday, that the US is not negotiating a civilian nuclear deal with Pakistan.

“Let me state categorically we have not entered into negotiations on a 123 agreement (a US legal requirement for any nuclear deal) with Pakistan, nor are we seeking an exception for Pakistan within the Nuclear Suppliers Group in order to facilitate civil nuclear exports,” the official said.

He said news reports of the US discussing with Pakistan a civilian nuclear deal similar to the one signed with India almost 10 years ago were “completely false”.

On longtime Pakistani efforts to involve the US in Kashmir, Sharif was told that won’t happen unless both India and Pakistan asked for it together. As of now, the US considers it a bilateral issue.

“President Obama discussed with the prime minister the situation in the LoC (line of control). Pakistan has often made a request for the US to be engaged in it,” the official said.

India has all along resisted any third-party involvement over Kashmir. And the official insisted there is no change in US policy of letting the two countries resolve it bilaterally.

The 65-year-old Sharif assured Obama of his country’s resolve to act against Lashkar-e-Taiba and deny the Haqqani Network, which has been called a veritable arm of ISI, sanctuary in Pakistan.

New Delhi welcomed his assurances on the two terror groups but countered Sharif ’s charges that India had backed off from a constructive dialogue.

“India has always desired resolution of all issues with Pakistan bilaterally through dialogue and peaceful means, but it is Pakistan which has chosen to use terrorism as an instrument of state policy,” ministry spokesperson Swarup said.

The American official also challenged reports of the Obama administration green-lighting the sale of eight F-16s to Pakistan, a traditional symbol in South Asia of US support for Islamabad.

But he defended past US sale of F-16s to Pakistan in principle and contested criticism that Islamabad doesn’t use them to fight terrorism. It does, he insisted.

India hoped that the F-16 sale process wouldn’t cross the US congress which has to ratify it. “The congress has many leading figures who understand Pakistan well … and has already questioned its rationale,” Swarup said.